1 / 12

2019 Bond Issuance Update

Stay informed on MSU's financial strategies including recent bond issuances, debt portfolio, insurance policies, and future projections. Learn about the $650 million bond issuance, investment banks involved, and the overall financial strength of MSU.

Download Presentation

2019 Bond Issuance Update

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. 2019 Bond Issuance Update Conversation with the PresidentMark P. HaasVice President for Finance and TreasurerFebruary 28, 2019 \\evpas.campusad.msu.edu\public\Staff - Individual Folders\Haas, Mark\Presentations\Conversations_LEAD\02_28_19_Conversation with the President mph 02 25 2019.pptx

  2. 300 Finance Team Members Manage • 330,785 student account bills for nearly $1 billion annually • $2.6 billion banking operation • $1.9 billion operating cash flow • $1.7 billion debt portfolio • 843,000 financial transactions, audited financial statement • 3,903 endowments (scholarships) valued at $1.4 billion • 4,321 research awards valued at $695 million, 36 compliance audits • Insurance for all aspects of MSU, 2,194 claims/consultations • $1.2 billion in purchases; 184,808 deliveries to campus • $5 billion retirement program oversight

  3. LawsuitSettlementPaymentandConstructionBonds • Issued $500 million short-term bonds on December 4, 2018, to make lawsuit settlement payment within 10 days of judicial approval • Issued $300 million long-term bonds in February to refinance part of December lawsuit bond, locking in interest rate and spread payments over 30 years • Also, issued $350 million of long-term bonds to fund construction in February

  4. 2019 Bond Issue Summary • Largest MSU bond issuance ever - $650 million • Five Investment Banks: Citi, BAML, RBC, JPM, MS • Market and investor uncertainties required investor presentations and multiple investor calls • Pricing strategies increased potential buyer pool • Strong demand for MSU bonds due to pricing strategy, financial strength, and transparency with rating agencies and investors • Taxable bonds with 10 year par call to allow future refunding at lower cost increased marketing challenge

  5. 2019 Bond Issue Details *Replaces part of December private placement, short-term lawsuit settlement funding and provides $22 million new construction funding

  6. How Will 2019 Bond Debt Service Be Paid? • Series 2019 A bond debt service will be paid from operating cash investment earnings • Series 2019 B bond debt service will be paid from a combination of General Fund, Departmental Funds and operating cash investment earnings

  7. Strategy: Invest Cash - Use Debt for Capital Projects

  8. InvestingOperatingCashNetted$342MillionPast10Years

  9. MSU Debt and Future Debt Capacity

  10. Financial and Insurance Strategy • Hope for the best but plan for the worst • Financial planning (cash flows and budgeting) assume no insurance proceeds for lawsuit costs • All insurance proceeds will be used to pay down lawsuit-related debt • Any insurance proceeds will free up annual funds earmarked for debt service to support university missions of education, research and outreach

  11. Questions?

  12. New MSU Travel @ State Solution Update • MSU began implementing Concur Travel & Expense in June 2018 • User-friendly, fully-electronic from authorization to reimbursement • Campus-wide travel advisory committee helped guide the process • Over 480 attended a sneak peek on February 6 • System Go-Live in April • Pilot launch with two colleges in April • Phased roll-out to campus beginning in May • All units expected to be fully using system by October • More information on MSU web site “Travel @ State Project”

More Related